Early Development of Foreign Merchants' Stock Companies in China:A Study of the Origination of Stock Companies in Modern China

Modern Chinese stock company system appeared to the stimulation and facilitation of foreign capital.So we must first of all study the early development of foreign businessmen's stock companies if we want to know the origination of modern Chinese stock company system.That is,the appearance of modern Chinese stock company is related to the science and technology revolution and the changes of the trade methods between China and foreign countries in the middle of the 19th century world;and it is also concerned with the severe existing pressure upon the banks run by foreign businessmen who were confronted with capital shortage and other problems.In 1862,Russell Co.under this condition set up,by all means,Shanghai Steam Navigation Company.After that,industries such as finance,manufacture and other public utilities saw the occurrence of stock companies one after another organized by foreign banks.Each of these companies possesses a large number of dependent shares invested by Chinese businessmen.Not until the 70s of the 19th century were some Chinese stock companies formally but autonomously set up.In fact,foreign banks were,while establishing their stock companies,restricted by the then economic level and the traditional operation custom;and in order to solve such problems,these stock companies tried all means to take countermeasures and adjustments,which led to variations in stock company system,for example,the subsidiary systems of share investment by terms,official profit,priority share for those who had direct business communications.